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In the 1980s, major legal service clients, especially insurance companies, finally tired of being gouged on fees. Low-rate defense firms were running fast clocks, while mainstream law firms were staffing conference calls with a half-dozen superfluous associate timekeepers. The clients responded by hiring audit companies to parse the bills and hold firms responsible for inexplicable excesses.
The results of the auditing initiative were bad blood on both sides and a dangerous rift in the inside/outside partnership, if "partnership" under such circumstances is not too absurdly optimistic a term.
Lesson: There can be no substitute for ongoing dialogue between buyers and sellers. Once the waters are poisoned, the antidotes can be equally fatal to the relationship. The auditing misadventure may be a thing of the past, but clients and law firms are still wrestling with the same problems that caused it in the first place.
A very different professional note was sounded at around the same point in time, albeit in a single exemplary instance. Three major law firms were competing in a beauty contest. Two of them presented impressive credentials and pedigrees.
The third, Paul, Hastings, Janofsky & Walker, bothered less about all that. Instead, the firm immediately focused on telling the prospect how it would conduct case reviews, including the scheduling of the reviews, who would participate, and what the likely agendas would be. Deservedly, Paul, Hastings won the contest and got the business.
Lesson: Smart buyers are interested in responsiveness and service first; professional qualifications and past successes, second.
At that point, in the 1980s, law firms were just beginning to understand the client's quintessential concern, which has much less to do with rates and budgets than you might think. But there …